CRM ACTIONS AND PROCESSES GOAL- ORIENTED DESIGN BASED ON RELATIONSHIP VALUES

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1 Assocaton for Informaton Systems AIS Electronc Lbrary (AISeL) Wrtschaftsnformatk Proceedngs 009 Wrtschaftsnformatk 009 CRM ACTIONS AND PROCESSES GOAL- ORIENTED DESIGN BASED ON RELATIONSHIP VALUES Bernd Henrch Unverstät Augsburg Gregor Zellner Unverstät Augsburg Susanne Lest Unverstät Regensburg Follow ths and addtonal works at: Recommended Ctaton Henrch, Bernd; Zellner, Gregor; and Lest, Susanne, "CRM ACTIONS AND PROCESSES GOAL-ORIENTED DESIGN BASED ON RELATIONSHIP VALUES" (009). Wrtschaftsnformatk Proceedngs Ths materal s brought to you by the Wrtschaftsnformatk at AIS Electronc Lbrary (AISeL). It has been accepted for ncluson n Wrtschaftsnformatk Proceedngs 009 by an authorzed admnstrator of AIS Electronc Lbrary (AISeL). For more nformaton, please contact elbrary@asnet.org.

2 CRM ACTIONS AND PROCESSES GOAL-ORIENTED DESIGN BASED ON RELATIONSHIP VALUES Bernd Henrch, Gregor Zellner, Susanne Lest Abstract In order to realse the potentals of CRM, relatonshp-specfc processes need to be desgned and mplemented. Yet the followng questons stll reman: what s the dfference between relatonshp processes and tradtonal product and transacton-orented processes and how can relatonshp processes be dentfed and desgned? Based on busness defntons (e.g. how can a customer relatonshp be mantaned?) the authors gve frst answers to ths queston by usng a systematc, goal-orented specalsaton of generc actons. As an example, one relatonshp-specfc process wll be desgned n the course of ths paper.. Introducton CRM s stll one of the most dscussed topcs n research and practce. New theoretcal approaches for explanng and engneerng the nteracton between busness partners are expected to be devsed, as new economc mpulses for companes (n saturated markets) are needed [5]. But, what s the scentfc understandng of relatonshp-orentaton n contrast to the tradtonal productor transacton-orentaton? And whch new processes have to be dentfed and systematcally desgned? Such questons whch have not yet been suffcently dscussed do not only have a theoretcal but also a practcal relevance. At least 70% of all CRM projects carred out to-date cannot be consdered but a falure [3]. Not because CRM-software faled, but because IT resources were not purposefully adapted to busness goals to mprove relatonshp-orented processes []. Aganst ths background, a formal defnton of the term customer relatonshp s gven whch s based on a bref reflecton of approaches presented n lterature. Ths busness defnton acts as a requrement for a conceptual, goal-orented desgn of relatonshp-specfc actons and processes (for goal-orented process desgn see also [] [3]). Usng the example create trust a process n fnancal servces s llustrated whch s destned to mantan and regan customer relatonshps. Fnally, the strengths and weaknesses of the presented approach are crtcally reflected and topcs for future research are outlned. Unverstät Augsburg, Germany Unverstät Regensburg, Germany 7

3 . Related work Customer orentaton whch has ncessantly been demanded over the last years s ndspensable n almost all ndustres n order to survve and do successful busness n saturated markets [5]. As n such markets the absolute growth rates stagnate, n partcular the accompanyng pressure caused by (ferce) competton leads to fghts for valuable customers [8]. In a severe compettve envronment the customer and hs assets defne a crucal resource that needs to be specfcally focussed n marketng (processes) [0]. Therefore managng customer relatonshps to create satsfacton, loyalty and retenton has ntensvely been concentrated on for some years now [7], and the term Relatonshp Marketng was coned n ths context [3] [8] [0]. In lterature a varety of defntons and concepts of the construct customer relatonshp can be found [4] [9] [36]. Many authors state that a relatonshp s to be understood as a sequence of recprocal, connected, non-concdental, realsed transactons [] [6]. It s thus seen as a holstc, contnuous nteracton wth so-called epsodes (ndvdual purchases) whch can not be clearly and unambguously separated from each other []. But what s the essence of these nterlnked transactons and what are the crtera to speak of a relatonshp? In ths context, numerous, partly dfferent, opnons do exst. Many of them as for nstance [9] state that a seres of transactons gradually transforms nto a relatonshp, as a result of the socal exchange between buyer and seller. A relatonshp s thus much more than a seres of transactons, and contans dmensons of power, cooperaton, commtment, and trust to name but a few. In contrast to ths, other authors emphasse the long-term, economc objectves of the partners (as well as ts nvestment nature) [7], whch are lost as sunk costs f the relatonshp s termnated. Other authors also name barrers of ext n the sense of dfferent costs, lke search costs and learnng costs or rsk factors as characterstcs for a relatonshp (e.g. [33]). The longevty of the relatonshp s clearly not seen as a barrer of ext. Apart from the above, a number of sources can be found n lterature hghlghtng (partally contradctory) crtera and cases where a relatonshp could or does exst or does just not exst (e.g. [5]). Aganst the background of these dvergent and partally vague defntons of the construct customer relatonshp, t s hardly surprsng that contradctory statements are made n lterature as regards the desgn of relatonshp-specfc processes. On the one hand, processes are dscussed whch prmarly focus the need to restructure the tradtonal dvsons dstrbuton and sales (purely product- and transacton-orented) and, n so dong, oppose the new dea of relatonshps. Such processes focus all customer contacts from the company s perspectve and are thus based on an extensve vew of all processes n marketng, sales and servces [9] [30]. The lnchpn of the approach of [30] s thus the sales cycle as t s focussed n transacton marketng. So t s hardly surprsng that the central dea of CRM,.e. the explct nterest n a long-standng, ntensve customer relatonshp, does not become evdent n the process models. In contrast, some authors dscuss processes whch drectly refer to the establshng and retanng of customer relatonshps lke for nstance customer mgraton or customer recovery [6] [34]. The process desgn takes place, but selectvely wthout an exact defnton of a relatonshp and wthout a statement as to what extent the customer needs are satsfed by the measures realsed n the processes. [6] descrbes, e.g. n hs fve-phase model, a procedure to establsh relatonshp strateges n the frst place and fnally arrve at modellng the relevant relatonshp-specfc processes. However, nether a goal-orented, effectve engneerng of processes nor ther explct modellng do take place. It s for nstance remarkable that selected processes are seen as elementary for establshng and mantanng relatonshps, yet they are nether explctly dentfed nor are possble nterdependences (e.g. wth respect to the pursued goal) between the processes revealed. In summary, t may be stated that ths knd of approach deals wth customer loyalty emphassng ts mportance, whereas the modellng of relatonshp-specfc processes s done only selectvely. 7

4 Hence questons lke, whch relatonshp-specfc processes do exst and how can they be desgned? have to be answered. Summng up, a contrbuton has to be made to dstngush between transacton-orented and relatonshp-orented nteractons on the bass of the essental crtera and to render the dentfcaton of relatonshp-specfc processes. 3. Defnton of a customer relatonshp 3.. Transacton-orented vs. relatonshp-orented nteracton As descrbed above, n saturated markets ts not the enterprses that decde wth whch customer they would lke to establsh a busness connecton (not a relatonshp!), but t s rather the (valuable) customer who selects hs busness connectons. Aganst ths background, t s necessary to analyse n whch cases t makes sense - from a customer s pont of vew - to speak of relatonshp-orentaton nstead of transacton-orentaton. Therefore, we assume a decson stuaton n whch a customer e.g. has to make several, solated purchases of fuel wthn a gven perod of tme. To do so, the crtera such as the favourable prce or locaton of a petrol staton are consdered durng the utlty calculaton, to name but a few. For reasons of optmsaton, the number of sngle transactons wth each petrol staton has to be determned, whch would change, f ceters parbus the prce of one petrol staton was temporarly underbd by a compettor (the customer swtches the suppler partally or completely). As a sngle transacton we defne a process whch s performed wth a sngle objectve (e.g. agreement, communcaton) and refers to a partcular nstant n tme, carred out between separate enttes or objects, often nvolvng the exchange of tems such as nformaton, money, servces and goods (lke a purchase of fuel)). What does, however, happen, f utlty values and costs exst that must be assgned (wth ther postve or negatve effects) no longer to a sngle transacton but rather to several transactons or to the entre busness connecton? In the afore-mentoned example (several transactons) the customer s decson would be based on the petrol prce and the locaton of the petrol staton; at the same tme the customer would be lkely to nclude (as an addtonal varable) n hs decson the dscount granted, scaled to the purchase quantty. Such effects shall be defned below as relatonshp effects. Relatonshp effects result from the drect or ndrect contact between customer and suppler, f a general recommendaton n favour of ths partcular suppler s gven (postve effect on the busness connecton). Ths means that the customer carres out actons to beneft (conscously or unconscously) n the present or future (to create utlty or to avod costs). The latter hnts at the transacton-spannng mpact of relatonshp effects whch s consdered n ths context. An example could be an nternet access portal confgured to the ndvdual needs of bank customers (user-frendlness, relablty, etc.) thus cuttng the costs of future transactons. The defnton ponts out that the relatonshp effects can be created by monetary and non-monetary values. [3] analyses - by means of an emprcal study - possbltes to generate relatonshp effects. He nvestgates whch motves from a customer's pont of vew exst and make hm establsh, mantan, or termnate a relatonshp. On that bass, monetary and non-monetary values (so called relatonshp values can be derved whch are to be delmted from other concepts as for nstance the Customer Lfetme Value as the sum of the dscounted cash flows (cash value) of a busness connecton. In so dong, t s mportant to underlne the fact that the monetary values have a transacton-spannng mpact and do not concern ndvdual solated transactons (as for example prce dscounts for a transacton). The relatonshp values dentfed are presented n table. 73

5 Table. Identfed relatonshp values to create relatonshp effects Relatonshp value Descrpton commtment The sensaton of beng emotonally oblgated towards and closely connected wth ( atttudnal dmenson ) a reference object (e.g. a bank counsellor) due to a feelng of moral grattude or due to common atttudes and standards. nvolvement Descrbes the degree of actvaton, motvaton, and nterest of a person, beng trggered by means of a certan mpulse (e.g. the specfc desgn of bank subsdary or a very lkeable counsellor) thus resultng n establshng and retanng a relatonshp. trust Refers to one s atttude towards a person or a group of people, relyng on ther wllngness and ablty to meet one s expectatons, n partcular wthout beng opportunstc. monetary A monetary premum corresponds to a prce advantage beng promsed whch has a premum & postve nfluence on the appeal of a decson opton (e.g. to ntensfy a relatonshp). sanctonng On the other hand, sanctonng refers to a threatened punshment meant to take measures aganst the rejecton of a decson opton and thus to prevent t. specfc Ths term refers to a (monetary) commtment meanng an nput of resources by the nvestment contractual ncentve & control mechansms 3.. Impact of relatonshp values customer whch would suffer an mparment outsde ths relatonshp. Contractual ncentve & control mechansms as for nstance guarantees, proft-related fees or sanctons (repayments, f the customer s not satsfed) wll be offered by the company to enable the customer to clam the degree and the qualty of the performance delvery. In ths secton, we nvestgate the mpact of relatonshp values on a customer s decson to derve a precse defnton. The followng premses shall apply to the customer s calculus concernng the establshng, mantanng, and termnaton of busness connectons: P. The customer shall have a utlty preference relaton, that means he or she can assgn to each transacton t T submtted by a suppler a real utlty value Φ(t) usng a mappng Φ: T R. Thereby a value rankng of all alternatves can be defned. Thus an alternatve t s n relaton to another alternatve t j [superor/nferor/equvalent] f the utlty value Φ(t ) s [>/</=] to Φ(t j ). P. The utlty preference relaton has to be complete, reflexve and transtve. P3. The preference relaton shall consder not only monetary but also non-monetary elements (e.g. oblgng behavour of the staff or beneft from the suppler s mage). At frst, a customer only wants to purchase one product or one servce (sngle, solated transacton). If I dfferent supplers offer the requested transacton, a customer wll prefer the transacton t * of the suppler * (wth * I) for whch the net utlty value e of * (gross utlty value U(t * ) calculated by the preference relaton less the total costs of C(t * )) s superor n relaton to every other offer. The costs C(t ) result from the purchase and utlsaton of the offered servce t. Thereby the utlty value results from the drect contrbuton of the offer n order to satsfy the customer s needs [5]. An example: If a bank customer wants to take up a constructon loan, he or she compares dfferent offers by valung characterstcs of loan products such as duraton or payback modaltes and by consderng cost aspects lke e.g. the annual percentage rate. In lterature, repeated transactons follow sut (T homogenous transactons overall), they are, by defnton, consdered as beng separate from each other. Often the ether-or-premse s set, whch means that ether all or no transacton(s) are/s settled wth a suppler. At least n prvate consumer markets, lke n fnancal servces, ths defnton s, of course, smplfed. For ths reason, the ether-or-premse has not been used here whch means that, dependng on the partcular realsable net utlty value, the customer wll select for each transacton t T the best possble offer (maybe each tme provded by a dfferent suppler). 74

6 Therefore n the customer s calculus, an optmal selecton of the transacton shares λ (e.g. f a customer settles 5 out of 0 transactons wth suppler then the transacton share λ s ¼) has to be determned for all supplers I. The utlty value and the costs of a partcular transacton share λ contanng the utlty values U(λ ) and costs C(λ ) of all transactons s settled wth only suppler. [] max e = U ( λ ) C( λ ) wth λ = The mpact of relatonshp effects can be dfferentated as follows: Relatonshp effects V C shall have a constant utlty mpact wthn an nterval [lower lmt (LL) λ upper lmt (UL)] of the transacton share. An example to ths effect are recommendatons of a customer for a suppler ( transfer of reputaton) to reduce the nherent rsk (due to a potental opportunstc behavour of the suppler) of another customer. In contrast to ths, relatonshp effects V C can also occur f the transacton share exceeds a certan lmt whch s substantally larger than zero (λ >> 0). Examples are promses of bonus percentages or fdelty rebates for a number of potental subsequent transactons (transacton-spannng mpact). The relatonshp effects V V shall have a utlty mpact whch changes contnuously dependng on the transacton share (change coeffcent v > 0 and exponent γ > 0). An example to ths effect s the possblty to customse servces on the bass of customer data gathered over a longer perod, durng prevous transactons. Agan the relatonshp effects could depend on an nterval [LL λ UL]. If the relatonshp effects are consdered, the customer s calculus changes as follows: [] I = max e = U ( λ ) C( λ ) + V ( λ ) wth λ = In general, the relatonshp effects V(λ) can be descrbed as follows: V C V γ C [ 3] V ( λ ) = V + V wth V = v λ and V = constant wthn an gven ntervall A smple case wth two supplers s presented to back up the statements: the customer optmses gven functons of both supplers wthout dynamcal adaptatons. for 0 < λ < 0.4 Suppler : Suppler : U ( λ ) = 9λ U ( λ ) = 8.5λ 0.8 C( λ ) = 3.5λ C( λ ) = 4λ V ( λ ) =.5λ V ( λ ) = λ + I = for 0.4 λ < 0.8 for λ 5 for 0 < λ < for λ < 3 for λ The utlty functons U and U shall have the usual, concave run due to purely transacton-orented reasons (e.g. prce fluctuatons n-between transactons). On the other hand, a lnear ncrease (constant unt costs of a sngle transacton) s defned for the costs functons C and C. The functons of the relatonshp effects V and V consst of the parts V V und V C n each case. For suppler a customsaton utlty results from collected customer data (postve, removng margnal utlty for rsng transacton shares), whch leads to a contnuous functon V V =.5λ wth λ ]0;]. The functon V C conssts of ntaton costs of the busness connecton (λ ]0;]) at the heght of, as well as two constant, postve relatonshp effects at a value of.5 wth λ ]0.4;] and.5 wth λ ]0.8;], because of two partcular bonus payments. To that extent all, three sngle effects result as a whole n the above-mentoned, dscontnuous functon V C. The functon V s to be analogously nterpreted for suppler. If, n a frst step, we only regard the drectly attrbutable, solated net utlty value of the transactons (see []), the followng customer s calculus as well as the transacton shares λ and λ are resultng: 75

7 max e = U( λ ) C( λ ) + U( λ ) C( λ ) = 3.5λ + 8.5( λ ) 4( λ ) * * λ 0.67 λ 0.33 In contrast to ths, f we explctly consder the relatonshp effects from the equaton [] the followng calculus results: 9λ 0.8 max e = U ( λ ) C( λ ) + V ( λ ) + U ( λ ) C( λ ) + V ( λ ) = 8.5( λ ) 4( λ ) + ( λ ) λ 3.5λ +.5λ + 8.5( λ ) 4( λ ) + ( λ ) λ 3.5λ +.5λ + 8.5( λ ) 4( λ ) + ( λ ) = 9λ 3.5λ +.5λ ( λ ) 4( λ ) + ( λ) λ 3.5λ +.5λ ( λ ) 4( λ ) + ( λ) λ 3.5λ +.5λ ( λ ) 4( λ ) + ( λ ) λ 3.5λ +.5λ + * * λ = 0.3 λ = for λ = 0 for 0 < λ 0.3 for 0.3 < λ < 0.4 for 0.4 λ for < λ < 0.8 for 0.8 < λ for λ = Relatonshp effects cause dfferent transacton shares: whereas before 67% of the transacton shares were settled wth suppler, hs attracton and (wth t) hs transacton shares have now dropped to 30%. In return, the shares of suppler rse to 70%. The mpact of the relatonshp effects s llustrated n fgure. It shows the two net utlty functons of supplers and (at the axle λ = reflected,.e. λ = -λ ) and the resultng cumulated utlty for the customer. The fgure shows that suppler loses dramatcally n transacton shares n spte of a much hgher V V wth.5λ opposte λ (suppler ). Ths s because of the partally lower V C and the dfferent nterval lmts. In summary, t can be stated that the relatonshp effects do not am to optmse a sngle, solated transacton n relaton to a competng offer. In the frst nstance, these effects honour a more ntensve or longer lastng busness connecton. utlty values Optmum - 0 0, 0,4 0,6 0,8 transacton share λ (resp. -λ ` ) Suppler Suppler Cumulated utlty value Fgure. Graphcal representaton n the two-suppler's-case (example) Based on these results, the construct relatonshp s defned as follows: A relatonshp s establshed as part of the nteracton between a customer and a company (from the customer s pont of vew) f due to the exstence and relevance (domnance s not necessary!) of monetary and non-monetary values future transactons or contacts emerge. In partcular, the relevance of monetary and non-monetary values (a suffcent crteron for a relatonshp) s gven, n case that an nferor offer based on the net utlty calculaton of solated transactons (see equaton []) s nonetheless chosen by the customer. The customer s decson n favour of the nferor offer s due to the monetary and non-monetary values that overrde the nferorty (.e. the relatonshp character of the nteracton). However, f the nteracton s determned by the net utlty calculaton of solated transactons, the suppler's measures to desgn 76

8 sngle transactons are domnant (monetary and non-monetary values are not relevant),.e. the entre nteracton s charactersed as transacton- and not as relatonshp-orented. 4. Desgnng relatonshp-specfc processes In ths last chapter, we suggest that the exstence and relevance of relatonshp effects are the decsve factor for relatonshp-orented nteracton, based on monetary and non-monetary values (e.g. trust), the so-called relatonshp values. In the followng, these values act as busness defntons. The goal of relatonshp-specfc processes that need to be desgned s to manage such relatonshp values when nteractng wth the customer whch s the lnk between the two modellng domans. But whch partcular actons does the collectve term to manage comprse? Below, the study of the addressed (generc) actons accordng to the relatonshp values leads to the dentfcaton of dfferent relatonshp-specfc processes. 4.. How to dentfy generc actons n CRM [4] underlnes that ( ) to dentfy ( ) busness processes ( ) s an extraordnarly dffcult undertakng. From the pont of vew of process modellng methods [5] [] [35], dervng new (types of) processes s based upon outlnng vsons. Dependng on the actual stuaton, ths could be done creatvely by usng the know-how of experts, documented examples of nnovatve solutons of the same or another ndustry, or by usng the potentals of new technologes. Gatherng e.g. the dfferent opnons (of experts) s of great mportance; nonetheless t s affected by subjectve nfluences and thus often makes a systematc dentfcaton of new processes n CRM dffcult. And, as exstng lterature on processes n CRM shows (e.g. [6] [34]), only selected ponts of the relevant expert knowledge appear to be avalable so that the outlnng of vsons cannot be based thereupon. Contrary to ths, the dscusson of generc actons and goal-orentaton s more systematc (e.g. [6] [3]). The concepton of generc structures s based on the prncple of abstracton. As for the generalsaton and specalsaton n data modellng, abstract structures or actons are to be determned. Generc actons are not subjected to concrete nfluence factors or specfcatons and they allow a smpler dentfcaton of typcal processes. In ths context, the approach of [8] for nstance s well-known; t descrbes the dentfcaton and usage of generc actons. In the context of developng a process modellng-method (Process Handbook) and a modellng tool, the smlartes and dfferences of several connected processes were examned. Based on the above, [8] dentfed ten generc actons whch allow for representng almost all dfferent actons by usng ther specalsatons (actons whch could not be assgned so far are referred to as unclassfed ). The generc actons are: create, modfy, preserve, destroy, manage, separate, combne, decde, use, and move. [37] reduced those generc actons to the relatonshpspecfc, generc actons create, destroy, preserve, modfy, separate, combne, and move. These actons can be descrbed as follows: Table. Descrpton of the relatonshp specfc generc actons Create Dependng on the specfc customer, a relatonshp value s produced or ntensfed n ts effect. Destroy A relatonshp value s conscously or unconscously reduced or destroyed. Preserve A relatonshp value s mantaned (over tme). Modfy The type of a relatonshp value s changed conscously or unconscously, e.g. f another value appears to be more effcent from the suppler s pont of vew. Separate Two or more relatonshp values are created out of one value, e.g. separaton of confdence and commtment [0]. Combne Two or more relatonshp values merge nto one new value. Move A relatonshp value of customer s extended onto another customer j (e.g. the suppler uses recommendatons to extend trust onto other customers). 77

9 4.. How to specalse generc actons n CRM So far dfferent generc actons were dentfed and dfferentated to defne the term "relatonshpspecfc". A detaled descrpton and modellng has not yet been acheved. Hence, the queston arses how the generc actons can be specalsed n a concrete stuaton. In chapter two we have stated that the exstence and relevance of the relatonshp values establshes and mantans a relatonshp. In a frst step, the suppler has to analyse whch relatonshp values to choose. As has been explaned n chapter three, several values exst (e.g. commtment, nvolvement and trust). Furthermore, the suppler has to determne whch generc acton should be combned and specalsed wth whch relatonshp value. For nstance, a generc acton lke create has to be combned wth relatonshp values such as create trust or create premum. In addton, ths combnaton has to be adapted to the targeted customer; otherwse the relatonshp value s worthless for the customer. Apart from that, t has to be analysed whether parameters exst whch lead to mportant dfferences n the way a relatonshp value s to be e.g. created. In further steps t s to be examned n whch stuatons durng the lfe-cycle of the relatonshp the descrbed actons are used and how they have to be specalsed n a certan relatonshp stuaton (e.g. acton create trust durng the phase of relatonshp acquston vs. relatonshp recovery). [4] ponts out that the systematc utlsaton of relatonshp values crucally mproves the prospects of success, e.g. for customer reactvaton or wn-back, snce takng advantage of the customer s stll exstng goodwll stemmng from the past busness connecton s of paramount mportance for wnnng hm back. An acton lke create trust obvously has to be deployed dfferently n the case of an acquston (the customer s not known to the company and therefore has to be addressed wth senstvty) than n the case of wnnng a customer back (both the customer and the hstory of the past busness connecton are well-known). In lterature, the phases of a relatonshp and the stuatons n a relatonshp are dscussed aganst the background of the lfe-cycle-concept [8]. Fgure shows the deal phases. strength of relatonshp values get known to get famlar be famlar be used to trust get unfamlar relatonshp reactvaton be unfamlar relatonshp ntensfcaton nvolvement relatonshp acquston specfc nvestment relatonshp recovery meet start penetraton maturty crss dstance Fgure. Relatonshp-lfe-cycle and relatonshp values creaton (deal) In a smplfed manner, fgure shows that the phases meet, start, penetraton, maturty, crss, and dstance can be dfferentated: to each phase selected stuatons (relatonshp acquston, ntensfcaton, reactvaton, and recovery) can be assgned durng whch the suppler gets actve. For a selected customer e.g. the development of the relatonshp values trust, nvolvement, and specfc nvestment s useful. Ths means that all generc actons are to be specalsed by means of the parameters "relatonshp value and relatonshp stuaton". Snce the phases and relatonshp stuatons are not clearly separated from each other (n lterature ether), an unambguous allocaton of the generc actons to phases s very dffcult. To separate the dfferent phases, the (relatve) strength of the relatonshp values depends on the nterval resp. the phase. Further work would, however, have to be done defnng the measurement and nterval-creaton by means of customer surveys and data mnng. phase 78

10 Apart from these problems, the attrbutes relatonshp value and stuaton provde a conceptual bass for specalsng generc actons,.e. to desgn relatonshp-specfc processes. To llustrate the latter, n the followng chapter a selected process of CRM wll be examned assumng specfc parameters of customer-type, relatonshp value, and relatonshp stuaton. 5. Applcaton: Desgn of a relatonshp process n fnancal servces In ths example, we assume an enlghtened customer type (accordng to [3]), the value trust and a relatonshp reactvaton stuaton [3]. The example s set n the fnancal servce ndustry. The enlghtened customer type s, above all, charactersed by hs non-monetary motves [3],.e. he can be attracted partcularly by commtment and trust to reactvate hs relatonshp. For an ntegrated representaton of the processes n CRM regardng a specfc customer type t would be necessary to consder ts relatonshp values throughout all phases. To avod unnecessary complexty n ths paper, the example just focuses the relatonshp reactvaton stuaton. If a suppler wants to reactvate a relatonshp, he wll have to focus on e.g. the processes create commtment and create trust to generate the relevant relatonshp values. In ths phase create s to be understood n the sense of rebuld. Agan to avod complexty, only the process create trust wll be consdered. The goal of ths process must be to generate relatonshp effects by provdng nonmonetary values to the customer to promote the relatonshp. Fgure 3 presents the process create trust n a relatonshp reactvaton stuaton for the enlghtened customer type represented n an UML actvty dagram. CRM-Back offce CRM-Front offce Customer Defne reactvaton crtera Contact target customers Remove dssatsfacton reasons Choose acton for trust creaton Tell dssatsfacton reasons Parameter Customer type: lberated type Relatonshp value: trust Relatonshp stuaton: Customer reactvaton Consderng dssatsfed customers (based on complants) Identfy dssatsfed customers (wthout complants) Indcate references (e.g. award for best load product) Assure personal engagement of bank advsor Hghlght prevous, remarkable efforts va the bank Calculate customer reactvaton potental Legend Buld reactvaton portfolo Check customer satsfacton Use offer Start [customer s satsfed] [customer s not satsfed] End Care about reactvated customers Check further possbltes to satsfy customer [possblty stll exst] Decson Actvty [no more possblty] Qut relatonshp Transton- Splt/-Sync Transton Fgure 3. Process create trust n a relatonshp reactvaton stuaton Frst of all, all customers who are dssatsfed have to be dentfed, no matter f they complan about t or not. In the frst case, the customer s atttude can be reconstructed on the bass of exstng complants. To dentfy those customers who are dssatsfed but do not utter t, s dffcult ndeed. Hence crtera, on the bass of experences or data mnng, have to be defned to enable the dentfcaton of dssatsfed customers. Once these customers have been dentfed, an evaluaton has to be carred out as to ther attractveness and potental to the suppler to determne whether 79

11 reactvatng the busness relatonshp makes sense. In the affrmatve, these customers are contacted amng at smoothng out the reasons for ther dssatsfacton. Snce the suppler knows that these customers belong to the enlghtened customer type, goal-orented relatonshp effects have to be generated by means of the relatonshp value trust. Accordng to the theory of the perceved rsk [7] whch descrbes the behavour resultng n ether ganng or losng trust the fnancal servce provder can take dfferent measures: the provder can make sure that a competent counsellor takes care of the customer. Lkewse the bank can provde references of dfferent knds or hghlght prevous, remarkable efforts on the part of the bank (e.g. the customer exclusvely receved shares of a closed-end nvestment company only avalable n very lmted numbers). If the customer can be convnced, theory assumes that the trust of the customer s strengthened and hs satsfacton ncreased. Aganst ths background, chances are that the customer wll resume/re-enter the relatonshp and be all the more loyal. If he contnues to be dssatsfed, the bank may retry to adapt the trust measures on the bass of the customer typespecfc crtera and maybe generate hgher relatonshp effects. Otherwse, the customer s lkely to dstance hmself from the relatonshp as soon as he puts more trust nto another fnancal servce provder. Once the customer s reactvaton has been successful, the bank wll take pans to take care of the customer to mantan the relatonshp values. 6. Concluson The paper provdes a frst approach of a systematc desgn of relatonshp processes. The man characterstcs are: Relatonshp processes are geared to generate relatonshp effects to establsh and mantan an ntensve and lastng relatonshp (relatedness vs. bondage). Relatonshp effects can be generated by means of dfferent, monetary and non-monetary, relatonshp values subject to specfc customer types. Therefore relatonshp processes must focus the management of these values over the entre perod of the relatonshp lfe-cycle. In order to dentfy the dfferent actons of the relatonshp management as completely as possble, generc actons were used. In so dong, seven generc actons of partcular mportance for CRM could be dentfed that have to be specalsed accordng to customer type, relatonshp value and stuaton n order to generate the relatonshp processes. To gve an example one of the relatonshp processes was dwelt upon. Ths paper does already address some crtcal aspects and hghlghts topcs of specal attenton to any future research. The specalsaton and detaled analyss as well as the qualty assurance [] of relatonshp processes must have prorty. The followng questons seem to be of specal nterest: Whch are the crtera to dentfy the relatonshp phase the customer s actually n? What s the role of the measurement of the strength of the relatonshp values? How can methods of data mnng be helpful n ths context? Consderng the dentfed relatonshp processes: How can the present IT functonalty of CRM systems be adapted and sensbly extended to mprove ther sutablty for companes? In summary, the developed approach has resulted n frst steps not only to dentfy relatonshp processes but also to advance ther goal-orented desgn. Both tasks seem to be necessary n the context of the present dscusson to advertse the dea of relatonshp, snce otherwse t runs the rsk of beng regarded as a mere restructurng of the sales doman. References Due to length restrctons, all references had to be omtted. The complete paper ncludng all references can be found at: 80